OGCA seeks slow-down on prompt payment legislation

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    Ontario Construction Report staff writer

    The Ontario General Contractors Association (OGCA) is urging the provincial legislature to take the time needed on prompt payment legislation (Bill 69) in order to address numerous outstanding issues and accommodate all types of payment arrangements.

    “OGCA supports the vision that general contractors, trade contractors, suppliers and workers should be paid in a timely manner for the work they do,” says OGCA president Clive Thurston. “We worked with the National Trade Contractors Coalition of Canada (NTCCC) to develop a framework which would follow with a collaborative process.

    “It was the intention and common understanding that there were a number of important issues involving other stakeholders that needed to be addressed before the legislation could be passed,” Thurston adds. “Pushing this through in its current form will prevent any detailed input from industry stakeholders and effectively shut down the consultation process.”

    OGCA worked with its partners in the residential and the construction design segments of the industry and identified important amendments required to assure that the intent of the Act is achieved.  Buyers of construction have just recently become involved in the discussion and it is vital that a collaborative process be used to address their needs, Thurston said.

    “Bill 69, in its current form, simply won’t achieve the original vision of the proposal,” said PCL Construction executive vice-president Chris Gower. “The Act, as written, does not address complex contracts such as Alternate Financing and Procurement (AFP), Public-Private Partnerships (P3), Engineering Procurement and Construction (EPC), Design Build (DB) and Integrated Project Delivery (IPD), to name a few.

    “Even a heavily modified CCDC 2, which is very common in the industry, will not work under the legislation as written,” says OGCA chair Sam Cutruzzola, president of Inzola Construction.

    Vaughan MPP Steven Del Duca’s Bill 69, currently in the hands of a legislative committee with public hearings set for March 19 and 26, has successfully spotlighted the issue and established the importance of enshrining the principles of prompt payment in Ontario.

    “The OGCA was part of the process right from the beginning and helped draft the language of the Bill,” said Hugh Laird, executive director of Ontario’s Interior Systems Contractors Association (ISCA), one of the proposed legislation’s strongest proponents.

    “What they are saying is that they want to make sure it’s done right,” Laird said. “We want that as well. There should be no reason why the OGCA shouldn’t be able to articulate their specific concerns over the next couple of weeks to everyone’s satisfaction. That’s what committee hearings are for.

    “No one disagrees with the principle of prompt payment. Some of the objections that are being heard now stem from taking sections of the proposed Act out of context or simply misreading the Bill. The purpose and intent are very simple, and those are to ensure payment within 30 days following certification.”

    “We are concerned the legislation, as written, will only get it partly right. It will result in more problems than it will solve,” the OGCA’s Thurston said. “We must take the time required to address all legitimate issues to make sure that payments in the construction industry are made in a timely manner.”

    The OGCA announcement comes after the National Trade Contractors Coalition of Canada (NTCCC) spent $500,000 on a television advertising committee to move the private members’ bill, introduced by Vaughn MPP Stephen Del Duca and which passed first reading last may, through the order paper and towards proclamation.

    The legislation appeared to be stalled in the fall after associations representing residential contractors and owners, and municipal governments expressed concern about the legislation’s provisions.

    “I’m thrilled to know that this much-needed legislation, which will help strengthen Ontario’s construction industry, will be reviewed at committee in the coming weeks,” Del Duca said in a late February news release.

    Currently, prompt payment legislation is in place in the United Kingdom, the European Union, Australia, Ireland and in the vast majority of U.S. states.

    “Ontario’s construction industry employs 434,000 people and accounts for 6.4 per cent of the province’s apprenticeships,” said Del Duca. “If passed, the Prompt Payment Act will ensure that those who complete their work get paid on time and this will lead to greater job creation and increased apprenticeships.”

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